OCT 22, 2015
Canadian-based pharmaceutical company Valeant’s woes began a week ago when a report published by short-seller Citron Research accused the company of massive fraud. The report alleges that Valeant used specialty pharmacies to generate fake invoices to inflate sales and dubbed it the “pharmaceutical Enron.”
Stocks on Valeant have declined steadily since the report. At the same time, it was hit with a federal subpoena demanding more information on its pricing and distribution practices. Valeant is also under a large amount of debt stemming from purchases of several pharmaceutical companies including Bausch & Lomb in 2013 and five other subsidiaries in 2015.
Valeant vehemently denies these accusations, saying the allegations “contain numerous errors, unsupported speculation and incorrect interpretation of facts and circumstances.” It plans to hold a conference call on Monday to address the controversy.